LCEC, city reaffirm positions

Little resolved at meeting on Thursday

December 22, 2017

It seems the only thing the city of Cape Coral and LCEC can agree upon these days is to disagree.

That message came loud and clear from both sides as city officials and representatives from the Council for Progress visited the LCEC Board of Trustees meeting Thursday at LCEC headquarters in North Fort Myers.

City Manager John Szerlag said in the end he hoped both sides would eventually get the same thing; an agreement that is good for Cape residents while being cost neutral to the power cooperative.

"We've been a long time on this issue, too long. We started out with positional bargaining, a declaration of a solution without consideration to the other side," Szerlag said. "That didn't work out well."

Mayor Joe Coviello described the situation as something like an extra-inning baseball game.

"It's the 17th inning and a few people are still in the stands hoping the home team hits a home run so we can go home happy," Coviello said.

Joe Mazurkiewicz and Brian Rist from the Council for Progress were brought in to mediate, changing the dynamic from positional to interest-based bargaining, Szerlag said.

Mazurkiewicz said it worked, sort of. Out of 31 issues the two sides had, it got whittled down to 12. An agreement was close at hand, he said.

If there was one issue they agreed upon, it was the desire to keep out of the courts, where taxpayers and ratepayers would be forced to fund the litigation on both sides.

"Everyone was lawyered up and we were getting nowhere and I was having a tough time paying for both sides," Rist said. "Lawyers don't solve a lot of problems and they cost a lot of money. We've reached a stalemate, and if we don't see a clear path to an agreement, I don't see any sense in continuing."

Among the sticking points has been the length of the agreement and technology, as well as providing rates and service at or near what FP&L provides.

Denny Hamilton, CEO of LCEC, thanked everyone for their time and words, but his other words were about the same as they have always been on the LCEC side.

Hamilton said much of what Cape Coral is asking doesn't pass regulatory muster and what they are asking is what nobody can quantify.

"I find it interesting that people who don't have years of experience in electric utilities claim to understand what does and doesn't pose cost," Hamilton said. "Terms like future technology are impossible to forecast costs."

Szerlag said after the meeting that the city still contends the Council For Progress-forged elements in the agreement that are good for the city and ratepayers as a whole, including being able to buy the assets, needs to be reconsidered.

"The city needs to have the ability to purchase the asset because we don't know what will happen to electric service over the next 30 years," Szerlag said. "It's up to City Council to decide what steps we take. I continue to hope we can underpin our interests and get away from positions and into interests."

Szerlag said he would talk to the mayor and council at the next Committee of the Whole meeting and discuss option moving forward.

Karen Ryan, LCEC spokesperson, said it was pretty much the same dialogue, with both sides miles apart on the main issues.

"Even though we've been working with them for three years on how a utility works, they have a lack of understanding of the business," Ryan said. "We cannot agree to their terms because they are not in the best interest of the ratepayers."

Editor's Note: This story has been updated to clarify a position of the city regarding the purchase of assets. Mr. Szerlag is referring to city-desired terms for a new franchise agreement.